It is a common practice in my workplace to offer a "freelance" agreement to employees. These employees are offered contracts ranging from 3 months to 1 year for a fixed amount (ranging from 1300 - 5000). The terms of the contract state they have to work a minimum of 200 hours per month, and every hour after this is considered overtime. There are no benefits whatsoever for these employees like EPF or SOCSO, and insurance. Often these staff work 7 days a week, often exceeding 12 hours in a day. Also after each contract term has finished, there is no break between the next contract, some of the current employees have been working under this system for 5 - 7 years without annual leave.
Is this practice legal or acceptable under Malaysian Law?
I am a bit doubtful about such type of contract. You better report the matter to the Labour Department , EPF and SOCSO respectively because it may require more detailed investigation into the actual nature of your work before deciding whether the employer is liable or not.
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